I have to agree that $400 is the absolute minimum for a gaming computer, especially if you want something that's "mid-range". Getting a decent CPU and GPU will suck up at least $200 instantly if you wanna be mid-range. A $320 gb hdd is like $55 at least (no point in getting 250gb cuz it costs the same). The case will be $40 or more. Ram will be $35-40 for good, cheap 1333-1600mhz ram. Power supply should always be at least 430w from a reputable brand.
Usually only HTPC's are $300.
I hate to say this though =/. An xbox 360 or ps3 might be a better option.